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The Impact of Public Scrutiny on Corporate Philanthropy

  • Ailian Gan

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    This paper proposes that a corporation’s vulnerability to public scrutiny drives its corporate giving. The hypothesis that companies donate for strategic motives is tested against the alternative that they do so for altruistic reasons. Court cases and news articles were selected as proxies for public scrutiny. Macroeconomic variables were used to gauge the level of public charitable need and test for altruism. Through examining the philanthropic behavior of 40 Fortune 500 companies over 7 years, this paper finds that companies are strategic and altruistic in their giving. Copyright Springer 2006

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    File URL: http://hdl.handle.net/10.1007/s10551-006-9087-4
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    Article provided by Springer in its journal Journal of Business Ethics.

    Volume (Year): 69 (2006)
    Issue (Month): 3 (December)
    Pages: 217-236

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    Handle: RePEc:kap:jbuset:v:69:y:2006:i:3:p:217-236
    Contact details of provider: Web page: http://www.springerlink.com/link.asp?id=100281

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    1. Harbaugh, William T., 1998. "What do donations buy?: A model of philanthropy based on prestige and warm glow," Journal of Public Economics, Elsevier, vol. 67(2), pages 269-284, February.
    2. Bernheim, B Douglas & Shleifer, Andrei & Summers, Lawrence H, 1986. "The Strategic Bequest Motive," Journal of Labor Economics, University of Chicago Press, vol. 4(3), pages S151-82, July.
    3. Duncan, Brian, 2004. "A theory of impact philanthropy," Journal of Public Economics, Elsevier, vol. 88(9-10), pages 2159-2180, August.
    4. Mike Adams, 1998. "An Analysis of Corporate Donations: United Kingdom Evidence," Journal of Management Studies, Wiley Blackwell, vol. 35(5), pages 641-654, 09.
    5. Stephen Brammer & Andrew Millington, 2004. "The Development of Corporate Charitable Contributions in the UK: A Stakeholder Analysis," Journal of Management Studies, Wiley Blackwell, vol. 41(8), pages 1411-1434, December.
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